raising money internationally: foundations and beyond

For organizations that have the resources and thereasons to explore international funders, the mone-tary and nonmonetary rewards can be considerableand surprising.

4Raising money internationally:Foundations and beyond

Patrick O’Heffernan

RAISING MONEY INTERNATIONALLY is a complex and difficult enter-prise for nonprofit organizations. It takes patience, a large tele-phone and travel budget, friends abroad, and an understanding ofwho or what is a donor. Many of the American development rulesof thumb do not apply, although some important ones do.

Why seek funds overseas?There are four fundraising reasons for organizations to look out-side the United States: they operate international projects, theyhave international partners with access to funders abroad, they haveinternational members, or they want to start working internation-ally. Any organization that meets one or more of these criteriashould consider prospects outside the United States.

In this chapter, the terms international funders, funders abroad, andfunders outside the United States are used interchangeably. They all

NEW DIRECTIONS FOR PHILANTHROPIC FUNDRAISING, NO. 28, SUMMER 2000 © JOSSEY-BASS

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refer to foundations, government agencies, or corporate funderslocated outside the United States. They do not refer to interna-tional organizations based in the United States, such as U.S. Aidfor International Development, except for the World Bank and theInternational Monetary Fund, which often work through localoffices around the world. Although large foundations such as Fordand MacArthur also work through country offices, they are notincluded in this chapter because they can also be contacted throughtheir U.S. headquarters.

International funders are key parts of the international com-munity that collaborates and trades information, staff, ideas, andcontacts on a daily basis. They are sources of information on pro-gram ideas, similar projects, and potential collaborators. Interna-tional funders are nodes in networks of nongovernmentalorganizations, think tanks, and consultants that can be useful toan organization’s programmatic success. International funders,especially the development aid organizations of European gov-ernments known as bilaterals, also sponsor workshops and con-ferences on programs and produce reports and surveys critical tononprofit organizations working worldwide.

Overseas projects

Global environmental, aid, disaster relief, and development orga-nizations may find it relatively easy to approach funders in Europeand Asia for support, and this effort is probably necessary at somepoint. Their projects usually involve countries that are supportedpolitically or economically by various European governments andinternational organizations and foundations. The beneficiaries areclearly not Americans but people or programs in countries orregions with high need.

Overseas partners

U.S. organizations with overseas partners can direct proposals forcore support to domestic foundations or corporations, and projectsupport to international funders, or vice versa. The flexibility ofusing domestic and international funds for matching and for legit-

52 APPROACHING FOUNDATIONS

imacy is a strong motivation for U.S. organizations with overseaspartners to try joint development.

Overseas members

Overseas members should not be looked on as just a source of duesor personal donations; they are an important resource that signals toa U.S. organization that it should be looking abroad for funds. Over-seas members bring contacts, knowledge of international donors,introductions, and information on local needs and conditions.

Desire to work overseas

As the world increasingly globalizes, it has become obvious to a grow-ing number of U.S. nonprofit organizations that they must either linkwith organizations in other countries or initiate projects in othercountries themselves. Launching an overseas program can frequentlybe done with U.S. funds to gain visibility and reputation with inter-national funders that can then be approached for subsequent grants.

Don’t leave home without knowing thisU.S. organizations seeking funds abroad for the first time are oftenpuzzled by the complexity of grant sources and dismayed by theiropaqueness. Whether the organization is a government agency, aninternational governmental organization (IGO), or a foundation,the path to the money is often difficult to discern and very convo-luted. As in the United States, each type of funding source and eachindividual source is unique and idiosyncratic. There are no stan-dardized formats, common rules, or routine ways of approachingor dealing with them. I have consolidated my experience into flex-ible rules of international funding that you can take abroad withyou, whether you are traveling on a search engine or an airplane.

Top-to-top contact is best

Most European and Asian foundations prefer to operate throughleadership rather than staff connections. Once an organization

53RAISING MONEY INTERNATIONALLY

identifies a foundation prospect in Europe or Asia, a board mem-ber in that organization should be put in touch with the executivedirector or a board member in the prospect foundation. This isbest done through third parties who can make the necessary intro-ductions.

Appointments may be very difficult without an introduction orintroductory letter from someone known to the staff or trustees.Direct approaches to the staff will likely result in no response oreven inconvenience and immediate rejection. European and Asianfoundation staff and trustees rely heavily on personal networks tovalidate the reputations of people who wish to meet with them. Itis best, and often necessary, that top-to-top contact be madethrough a local partner or another third party who has a previousrelationship. This is especially true in Japan, where the properintroductions are critical.

Be patient

Everything takes longer than it does in the United States, and muchlonger than any worst-case estimate. There are both logistical andcultural reasons for this. Time zones make the timing of telephonecalls difficult, forcing communications to be conducted through thepostal service and e-mail (which itself is slow because it is oftenpicked up the following day due to time zone differences). Althoughmany senior administrators in Europe or Asia speak English, theirstaff and voice mail may not, further slowing down communicationand raising communication costs. In China and some other coun-tries, all e-mail must pass through a government Internet providerorganization, which screens incoming content and may hold up e-mail delivery for days. Workers in many countries, especially inEurope, have more holidays and much longer vacations (five weeksannually in Holland, for example) than Americans do, which canstretch schedules and make some parts of the year impossible forconducting business. The cost of satellite time for videoconferenc-ing often mitigates against frequent use of what can be a techniquefor speeding up negotiations. The requirement of many interna-tional foundations and bilateral agencies that correspondence be in


their native language, even though all parties speak English, can adddays for translations of proposals and letters.

Culturally, the American custom of quickly getting down to busi-ness does not work well in many other countries, although this ischanging. Americans need to observe local socializing customs,especially in Asia, which may defer business for hours or even dayswhile the potential partners get to know each other better. This isnot nearly as true for bilaterals and larger foundations; nevertheless,time should be built in for nonbusiness conversation and even socialevents. A third party who made any introductions should be theretoo if possible, and this will inject some additional socializing time.

The end result of the logistical challenges and cultural differ-ences is that introductions, communications, appointments, andsolicitations will all extend far longer than initial estimates. Thiscan require expensive airline tickets and extended hotel stays.

Cultivation abroad is an art and a necessity

A single meeting or an encounter at a conference with a foundationdirector or staff member is generally not an adequate basis for solic-iting a European or Asian foundation. Even when initial top-to-topcontact has been made, the local partner should continue to build therelationship with both the board member and the foundation staffbefore soliciting support unless a proposal is requested or suggested.

While cultivation internationally is much more important thanin the United States, it is also much more difficult. Language canbe a barrier if staff or trustees of international donor organizationsconduct business in a language other than English, do not feel com-fortable in English, or are not easily understood. Moreover, theyprefer direct face-to-face contact before working long distancethrough e-mail, the telephone, and letters. Consequently, Ameri-cans will have difficulty cultivating donors, even institutional donors,in short trips, by e-mail, and through telephone calls. Once staffconnections have been made, e-mail and telephone work quite well,but the key to any cultivation is a local partner or collaborator.

For private donors, cultivation may take years while the leader-ship of a local agency establishes its credentials and is accepted into


particular social and professional circles, unless they are already partof the donor’s community. The cultivation techniques of invitationsto events or recruiting funders for conferences and speaking eventsare the same as in the United States, but they may take longer andrequire the sustained involvement of a local partner.

Funders may not be what they seem

Organizations called “foundations” outside the United States canbe anything from a donor to a political party to a labor union to aprivate bank account. Some European foundations fund only onegrantee, or they say they give grants but in fact do not. Others fundonly organizations or individuals with ties to their board. Somefund just one organization, often a labor union or political party.Others fund political campaigns or publications. Some foundationsin Europe and Asia are actually extensions of government agencies,such as the Japanese JETRO organization, which funds educationaland other projects from its worldwide offices and is supported bythe Ministry of International Trade and Industry. The GTZ Foun-dation in Germany is supported by the German government,although its agenda is broader than just providing German policysupport. The same is true of charitable organizations in Islamiccountries, which usually fund only religious programs and some-times serve to transfer funds from a single individual or family to asingle mosque or cluster of programs supported by a mosque orreligious school.

Misunderstandings are easy

Translations do not always capture the intent or even the meaning ofindividuals who are operating across national and language boundaries.Problems can stem from simple misunderstandings due to accents, theuse of the same words differently by national and American speakers,or differing unspoken assumptions or contexts. Expectations, especiallyabout timing, protocol, and approvals of a proposal or program, canvary between stakeholders, with disastrous or just humorous and harm-less results. Careful notes, revisiting unclear conversations and docu-ments, and the use of carefully reviewed written rather than verbal


communication before final agreements are necessary, along with atranslation check by a local partner or a native speaker.

Information is difficult to come by

For European foundations, the best information sources (and some-times the only sources) are the descriptions published by the Euro-pean Foundation Centre (EFC) in its directories. A few of the largerEuropean and Asian foundations have Web sites; most do not. Guide-lines and annual reports, expected in the United States, are not uni-versally available, may not be in English (except for foundations inthe United Kingdom), and may not have program descriptions andapplication instructions. No federal 990 forms exist to supply infor-mation on assets and grant making, although some countries requirepublication of financial data by foundations and trusts. E-mailaddresses for foundation staff are also far less common than in theUnited States. Obtaining information is best done by a local partneror branch office. If this is not possible, obtaining guidelines and pro-gram descriptions may require writing or faxing requests in the foun-dation’s national language. Telephoning will usually require workingin the foundation’s national language to accommodate clerical staffand voice-mail systems that do not use English.

Sources of international fundingSources of funds for international organizations or U.S.-basedorganizations operating in other countries include U.S. founda-tions, non-U.S. foundations and trusts, U.S. and non-U.S.-basedcorporations, the European Commission, United Nations agenciesand international governmental organizations, and individual devel-opment agencies. They are listed and detailed in many directories(some are listed in the References at the end of this chapter).

Non-U.S. foundations

There is no accepted definition of foundation outside the UnitedStates, and the laws and history of foundations vary vastly between


countries. For instance, in France, foundations were authorized bylaw in 1970 when the national Fondation de France was set up,along with a large number of corporate fondations d’enterprise andabout two thousand others, many of which operate as part of theFondation de France, which was modeled after U.S. communityfoundations. In England, foundations, which are usually calledtrusts, operated with virtually no oversight until the 1993 passageof the Charity Act, requiring registration with the Charity Com-mission. However, it was not until 1996 that trusts were requiredto publish annual reports.

In the Netherlands, a culture of private giving that began in thesixteenth century evolved into post–World War II laws that pro-vided for the registration of foundations (stichtingen or fondsen).However, the laws still do not require that foundations’ records bepublic. Similar differences exist in the laws of other countries gov-erning donor organizations. American grant seekers need a basicfamiliarity with national laws. A good beginning source of thisinformation is Harris (1999) or a local office or partner.

European foundations and the European Foundation Centre

One of the first sources that U.S. grant seekers turn to for informa-tion on non-U.S. funders is the European Foundation Centre(EFC). EFC, located in Brussels, is highly visible; it provides infor-mative publications and an information-packed Web page. It pub-lishes directories on funders and books on raising funds in Europe.

Although EFC is a highly user-friendly organization that providesaccurate information and regionwide data, foundations in Europecan be a challenge for U.S.-based grant seekers. Very few, for exam-ple, will consider a request from a U.S. organization, and many donot respond to proposals or letters of interest from anyone. Themajority of European foundations that do respond to proposals orletters require that they come from a European organization, oftenbased in the home country of the foundation and in its language.The strategy of a partnership between a U.S. and a European non-governmental organization (NGO), with the European organizationapplying for and receiving the funds, is not always a good one for


either agency because such partnerships may actually mitigate againstsuccess with some foundation managers, even when the project islocated entirely in Europe and is for the benefit of Europeans. A bet-ter strategy is often a service subcontract with the European partnerwith a fee for the work provided on the project plus overhead.

Many European foundations do not give grants but run their ownprograms or support favored organizations’ working with them.Application processes are not spelled out, and it is not always appar-ent that they accept proposals. A few seem to have no grant programsor operations at all, although they publish statements of their inter-ests. (For a complete review of foundations throughout Europe, seeGaronzik and Wood, 1995; Brown, 1999; Garonzik and Heggadon,1998; Davis, Goldsworthy, and Moncrieff, 1997; and the EFC Webpage, http://www.efc.be.)

National government development agencies

The Directory of International Funding Organizations (Charities AidFoundation, n.d.) lists over one hundred national development andaid organizations in Europe that fund nonprofit organizations inEurope and in some cases fund American nonprofit organizationsworking in partnership with European groups. Some are privateorganizations similar to foundations but operating with govern-ment funding, like the Adapt Community Initiative of the UnitedKingdom; some are multilateral organizations like the Organiza-tion of the Petroleum Exporting Countries (OPEC) Fund forInternational Development based in Vienna, Austria. Others arebilateral, like the International Development Research Centre inCanada and the Department for International Development inEngland. In addition, most Western European governments andthose of Canada, Australia, Japan, and other large countries fundprojects through development agencies. Governments in develop-ing countries also fund NGOs, although in smaller amounts andfor carefully controlled projects. In Brazil, for example, NGOswork directly with contacts in local and state governments, as wellas the federal government, to obtain funds and contracts. However,NGOs are also asked to give funds to certain officials or agencies.


Working with governmental development agencies is usuallyslow and difficult, even with high-level advocates and top-to-topcontacts. Nevertheless, for many nonprofits, the work is worth-while because the amounts of their grants and contracts are oftenmuch larger than those available from other sources. Governmentdevelopment agencies may advertise for tenders, or bids, or theymay operate standing grant programs, or make funds available toorganizations that approach them and negotiate a grant or contractthat helps the agency meet its agenda or goal. Agencies are inter-ested in specific issues, such as AIDS. They are concerned with pol-icy development either to forward a political agenda or strengthenan agency’s position on issues or geographic areas. They also careabout ongoing development programs in countries selected becausethey are important to the donor country. There is usually a politi-cal agenda.

Working with government agencies also requires thoroughresearch to find out the agenda behind the grant availability, thesequence of decision making if more than one person is involved,current government policy toward this issue or geographical area,and details of applying and decision making. High-level contactswithin the agency or the department it is housed in or with parlia-mentary representatives having oversight responsibility for theagency are very helpful because the competition from both NGOsand consulting firms is very tough for these funds.

Most important is following the proposal requirements to theletter and meeting all deadlines. There are often many applicantsfor each grant, and the first-round elimination can be based simplyon following directions and complying with deadlines. There arealso other ways to improve the likelihood of support:

• Determine what the decision criteria are.• Attend forums, seminars, or conferences at which agency offi-

cers speak.• Be aware of the senior staff’s school or college ties, which can

be very important in some countries, especially the UnitedKingdom.


• After submitting a proposal or bid, lobby decision makers in theagency, using its trustees, their contacts, and any contacts in the leg-islature or executive branch of the government. Lobbying and mostcontacts should made be through local partners; Americans work-ing alone will be at a distinct disadvantage.

• Publicize the organization’s work in the areas the agency worksin. Good press will raise the organization’s visibility and providecredibility. This includes circulating the proposal and prospectsto the organization’s communications director to generate sto-ries in the media the prospect uses.

International governmental organizations

Hundreds of IGOs fund projects and organizations in every part ofthe world. U.S. organizations are often as eligible as those from othercountries. Many are connected to the United Nations, and many oftenhave a political agenda. Major funders are the United Nations Educa-tional, Scientific, and Cultural Organization, the United NationsDevelopment Program, the World Health Organization, the NorthAtlantic Treaty Organization, the European Commission, the UnitedNations Environmental Program, the World Bank, and the Interna-tional Monetary Fund. Each of these and other IGOs operate diversegrant systems that are often broken down into dozens of specific pro-grams with either geographic or issue focus. The Directory of Interna-tional Fund Raising Organizations (Charities Aid Foundation, n.d.) andother publications by the Charities Aid Foundation list many of theindividual programs, but the best sources are the agencies themselves.The European Community and all of the United Nations agenciespublish paper and Web-based directories of their grant programs,almost all of them available in English.

Beyond Europe and the developed countries

Examples of philanthropy in other parts of the world merit atten-tion because those countries may be sources of support and becausetheir procedures differ from one another.

Latin America. Argentina and Brazil have sources of fundingfor international projects in their countries. Other Latin American


nations, such as Mexico and Venezuela, also distribute some funds,but not on the same scale. Argentine sources of funds include theEva Perón Foundation and CEDES, both state initiatives that dis-tribute social assistance throughout the nation to poor populations.A number of large, corporate foundations are also donors, includ-ing the McDonald’s Foundation, which supports Ronald McDon-ald Houses; the Bemberg Foundation, which supports the arts andeducation; the Arcor Foundations, set up by the Arcor candy com-pany; and the IRSA Foundation, set up by George Soros. Grantsfrom all of these are relatively small and usually carefully targeted atsocial welfare projects. U.S. organizations usually work with Argen-tine organizations on Argentine projects and may be expected tofind matching funds.

Brazil boasts over eleven thousand foundations, but most fund onlytheir own projects, and none is required to give grants from endow-ment. The largest foundation in Brazil, the Brandesco Foundation,set up by the Brandesco Bank, does make grants to local schools andsome other projects. Many U.S. foundations operate offices in Brazil,including the W. K. Kellogg Foundation, the MacArthur Founda-tion, and the C. S. Mott Foundation. The MacArthur Foundationworks with local funders and operating foundations mainly in the areaof population and women’s rights. Kellogg funds more widely, includ-ing providing support for environmental projects.

Asia. Exclusive of Japan, foundation giving varies substantiallyin Asia by country. As a highly developed country with both foun-dation and corporate giving and a large government giving sectorthat operates directly and through secondary organizations, Japanis a special case because of its concentration of corporate founda-tions and close ties between the government and the corporations.India, Singapore, and Pakistan offer opportunities for U.S. NGOsand a better view of Asian philanthropy outside Japan. One of themost interesting national models is Pakistan because it is a devel-oping country with a substantial philanthropic community andbecause it provides a look into Muslim giving.

The Aga Kahn Foundation (Bonbright, 2000) reported that in1998, Pakistanis contributed 30 billion rupees ($528 million) and


countless hours of volunteer time and in-kind gifts to variouscharities. Of this, 14 billion rupees ($246 million) was private giv-ing, and the remainder was zakat—a custom derived from theQur’an of prosperous families’ giving a percentage of their networth. In practice, the government collects a zakat of 2.5 percentof the assets of families with a certain minimum of wealth andredistributes it. The funds can be directed anywhere, althoughmost donations go to mosques, schools, and hospitals. In addi-tion, many Pakistanis (and other Muslims from around the world)give sadaqua, which can be personal donations or volunteer time.Corporations in Pakistan give generously, as they do in otherAsian nations. Funds come from multinationals seeking good cit-izenship in Pakistan and from local companies that give accord-ing to Muslim tenets of tithing and to support the owners’favorite causes. A few foundations exist, but most are not donors.Corporate giving in Pakistan was illuminated in A Survey of Cor-porate Giving in Pakistan (Bonbright, 1999), which found that 93percent of all companies operating in Pakistan donated money,products, or volunteer time. Most grants go to schools and hos-pitals and to protect the environment.

India also has a strong philanthropic sector and, like Pakistangiving, is concentrated in private gifts. No aggregate data areavailable on private giving in India, but the growing middle andentrepreneurial class, especially in the Bangalore area, and theremittances sent home from a huge number of Indians workingin the technology industry in the United States has led to a sharpincrease in private giving. Foundations or trusts have emergedin India in the past decade, including the National Foundationfor India, the N. M. Wadia Foundation, the Bombay (now, Mbai)Community Trust, and United Way of Baroda. They are fundedby wealthy families, government agencies, and some corpora-tions. As with private grants, no aggregate figures are availablefor total contributions from foundations. Corporate giving isemerging in India, led in part by the Tata conglomerate, but dataon corporate funders’ areas are not compiled yet. Partners in AidIndia links nonprofit organizations with corporations that can be


supportive and is a good entry point for U.S. organizations withan Indian partner.

International corporate giving

Sometimes corporations give because the cause is just or becausetheir owner or chair or senior executives are interested in an issue ororganization. But usually they give because giving helps the bottomline. Their giving is strategic: they give to develop goodwill theyneed immediately or will need in a future controversy, to be associ-ated with certain causes that are good for their image and that helpsales or recruiting, or in response to pressure from the civic sector.International corporations give for these reasons and others relatedto the nature of business in a globalized world. Often transnationalcompanies (TNCs) give to gain access to networks they can use toenter markets, set up manufacturing, recruit local talent, and obtaincritical introductions needed to obtain permits and acquire local part-ners. An organization’s network and advice it receives about a coun-try can be crucial in beginning international work.

For this reason, approaching TNCs requires a different mind-set than does soliciting a local or national company. If the approachis for a major grant or long-term sponsorship, not only shouldfundraisers build internal advocates, but they should understandthe international goals of the firm and its needs in various markets.Usually TNCs have an established program of giving at the head-quarters, through a foundation or corporate giving program, andlocalized giving through regional offices and manufacturing plants.But the marketing, community relations, and government relationsdepartments may have different needs, particularly needs for accessor goodwill in countries where they are trying to build or are los-ing market share, locate new facilities, or buy local companies. Forinstance, American Express gave locally in Vietnam for over a yearbefore it began a drive for new business there to establish its brandand build a network.

Development research should ferret out opportunities. It shouldnot only explore where the company foundation gives at head-quarters or to international programs, but also locate major offices


and plants or regional offices and their local gifts. For instance,British Petroleum splits its giving into rough thirds among theUnited Kingdom, the United States, and other countries where ithas operations or markets.

Organizations seeking funds from TNCs should

• Understand the business a prospect is in, what it makes and sells,and how sales are managed in each country

• Understand who its competitors are, the status of its revenuesand stock price, and its plans for expansion

• Find out if the prospect is a takeover target or has recently beentaken over, and determine if the new owners have changed orplan to change their local and international giving

Because of the staggering number of TNCs, not to mentionindigenous national firms, a good strategy for U.S. nonprofit orga-nizations is to adopt a business sector strategy that targets industrygroups that fit with its organization, such as a drug manufacturerwith a medical volunteer organization, and then solicit firms until ithas secured a lead gift. U.S. nonprofits should begin with U.S.companies in each sector to obtain a lead gift and build credibility,then use the lead gift to acquire other donors in the same industry,moving from country to country. Keep in mind that the nonprofitwill not always be seeking grants from the corporate foundation orgiving program, but rather may request support from governmentor community relations offices or from marketing or advertisingdepartments. Nonprofits should be aware of competing corpora-tions; in some cases, they will be able to solicit only one companyin a sector in each country. In other cases, especially those in whichfunds come from corporate giving and not through public relationsor marketing departments, companies do not mind if a nonprofitreceives support from their competitors.

Those who work with international corporations can often savetime and travel costs by working with business-oriented organiza-tions that routinely help corporations, like Business for SocialResponsibility and the World Economic Forum, or advocacy


groups, like Sweatshop Watch. Sources of information on interna-tional corporate giving include The Directory of International Fund-ing Organizations (Charities Aid Foundation, n.d.), and the Directoryof International Corporate Giving in America (Taft Group, 1991).

ConclusionA nonprofit organization should understand that internationalfundraising will take research, stretching its horizons, and expand-ing its address book, but the results are worth it and the adventureof obtaining international grants is even more rewarding.

ReferencesBonbright, D. A Survey of Corporate Giving in Pakistan. London: Aga Khan

Development Network, 1999.Bonbright, D. Philanthropy in Pakistan: A Report of the Initiative on Indigenous

Philanthropy. London: Aga Khan Development Network, 2000.Brown, S. (ed.). European Foundation Fundamentals. Brussels, Belgium: Euro-

pean Foundation Centre, 1999.Charities Aid Foundation. The Directory of International Funding Organizations:

A Guide for the Non-Profit Sector. Kent, U.K.: Charities Aid Foundation, n.d.Davis, J., Goldsworthy, J., and Moncrieff, D. (eds.). The Directory of Grant

Making Trusts. Kent, U.K.: Charities Aid Foundation, 1997.Garonzik, E., and Heggadon, M. European Grants Index. Brussels, Belgium:

European Foundation Centre, 1998.Garonzik, E., and Wood, S. European Foundation Centre Profiles. Brussels, Bel-

gium: European Foundation Centre, 1995.Harris, T. (ed.). International Fund Raising for Not-for-Profits: A Country by

Country Profile. New York: Wiley, 1999.Taft Group. Directory of International Corporate Giving in America. Washing-

ton, D.C.: Taft Group, 1991.


PATRICK O’HEFFERNAN is director of development of LEAD Interna-tional, coordinating the fundraising activities of thirteen LEAD nationaland regional offices, which conduct training in sustainable developmentfor emerging leaders in sixty countries.

raising money internationally: foundations and beyond

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